hi, everybody. welcome to the "closing bell." labt close one. it could be the day the dow closes higher for a monday. first time in nine weeks perhaps. photo finish. >> i came back because it could happen here. we are in final hour. anything can happen. if the dow -- here is where we are talking about. if the dow closes lower it would be the index's worst monday losing streak in almost 40 years. 1973. investors not take any big risks. friday we get the all-important july jobs report. a lot can happen this week that will affect your money. we have it all set for you coming up here in the next couple of hours. here is how we stand now. kind of a stutter-step opening this morning. dow higher and then lower.

now we are virtually neutral down just five points. but still above 13,000, 13,070 and change. nasdaq down 10. near the lows of the session. 2947. and the s&p 500 is down half a point at 1385. >> investors may be kind of cautious today but the dow has surged 2% in the past five days. folks bet on more global bailouts to save struggling economies. our investors are setting themselves up for perhaps a big fall if the fed and european leaders don't put their money where their mouth is? >> high expectations there. dan greenhouse is with us. rick santelli is standing by here. we have a lot to get to this week. we will know a little more about the central bank policy by the end of the week and know what the job number is as well. >> right. it is kind of a little ridiculous because we are expecting so much out of the fed

and yet we know that there's very little that he can do at this point. it is a little aggravating because we keep hearing the fed is, you know, looking at ways to help create jobs. that's really not their mission. by forcing banks to, you know, maybe lend more, gets them back into the position they were in that got news the financial crisis in first place was lending too much. >> rick santelli. you are not a fan of more intervention by any sense. mark receipts setting themselves up for those expectations. >> they are indeed. there's no doubt about it. today the dow is down seven, that's not what i see. i see a totally -- holding on to the post gains and that's significant. it is not only that we have the central bank of the ecb on thursday, we have the bank of england on thursday as well. and one final thought, our guest just said we want banks to lend. just look what's going on in the auto industry. how much -- how many more subprime auto loans have permeated the system in the last six to eight months.

>> you know, dan, if i can turn you more domestically to the earnings situation because -- a lot of earnings have come in slightly above. but they are slightly above lowered expectations and there have been earnings that have disappointed. how do you view the overall earnings landscape? >> when you read through everybody's earnings report, it is pretty clear that the word uncertainty is that -- the name or the best way to describe this earnings season, whether it is china or brazil or europe or america, whichever earnings report you choose to look at, a considerable amount of uncertainty with the path of earnings and more importantly revenues going forward. a lot of this hinges on the -- uncertainties surrounding the landscape. in that regard central banks become important. >> look at it this way. the dow above 13,000. the -- s&p is above 1380. even despite all of this uncertainty, and the lack of an aggressive fed right now. >> that's the power of central

banks. even modestly leaning into the wind federal reserve can help support asset prices. if you are an investor obviously in a week in which you expect global banks to get involved, the bias is certainly to the upside. >> i would just add quickly with respect to den are's first point, it is the job of the federal reserve right or wrong to target the unemployment rate and it is -- part of their mandate. >> if i -- >> wait a minute. juan to take -- he is taking you on there. >> really, a lot of their mandate has to do with inflation. i think that that's -- >> price stability. >> inflation. >> unemployment. >> not creating jobs. by forcing banks to get away from cash and forcing them to lend, that's what got them in trouble in the first place was lending too much. you can't make a company go out and hire just because have you given them a blown. >> i don't disagree with anything you are saying in theory. but let's just be clear. part of the fed's job, again, right or wrong, is full

employment. >> can i turn you to making this -- we know we have a tough week ahead of of news terms after lot of volatility surrounding the central banks, and jobs report. so where do you put your money to work in a market that once again is above the 13,000 mark on the dow? we have seen that mark before. >> yeah. s&p has been up this year 10%. it is -- it has been mostly in what we call the expensive defensive sectors like telecoms and utilities. what we would prefer is a bit of a mix of cyclicals and defenses, target our sectors like i.t. or a strong -- product cycle that's coming out later this year. they have also trailed the market. we also like energy and that's one area where it is a bit more cyclical and with higher oil prices projected for the rest of this year. we think energy can stage a rebound. also, mix in a few defensive sectors. we may favor consumer staples because this is a sector that hasn't seen quite the run-up we have seen in some of the other

real solid defensive sector. >> rick santelli, did you ever think you would see a day when corn would be near all-time high prices and the yield on the ten-year note would be all-time lows at the same time. >> no. it just -- absolutely mind-blowing and what's even more mind-blowing is that 2 epa is still debating and not even seriously whether to relax the ethanol mandate with the shortage of corn that we are anticipating. >> yeah. something we will talk about later this hour. thank you all. >> yes. see you later. thanks important joining us today. broader market may be stuck in neutral today but telecom, utilities and consumer staples sectors remain red hot. amanda drury has all the details on that. >> for all the pessimistic headlines, if you look at numbers, they kind of tell a bit of a different story. just very quickly on the indi s indices, s&p 500 is up 10%. dow is up nearly 7% year to

date. nasdaq up a hefty 13%. mind you, underscoring the current mindset of investors it is largely the defensive sectors that have been making you money and pushing some of these indices higher. consumers staples trading at the highest level on record with data back to 1995. within that sector, you have conagra foods, walgreens, coca-cola. telecom trading at their highest since may wait. the gain is in that sector have been sprint, crown castle and at&t. laggards in that sector, metro pcs which is down about 2.5% today. frontier communications down by 1%. utilities, very defensive. also trading at their highest levels since july 2008. up about half a percent today. again the leaders northeast utilities and aes and pepco.

defenses has been doing very well. nonetheless it is maybe too early early to take your money off the table with regards to defenses as there are a lot of potential head winds out there in the macro economic picture. >> yeah. lot of sweaty palms still out there now. market flash. couple of deal related stocks. >> we do. shares are down nearly 6 of% for citrix. coming off of lows of analyst report from over at bernstein. the issue with the retreat in citrix, oracle announced today of virtual networking company. another that vmware announced last week lot of people thought this was going to hurt citrix's competitive edge but bernstein note saying it believes that citrix will be unaffected. >> thank you very much. just under an hour to go before the closing bell rings. dow trading off about 19 points

and nasdaq traded off about 12. >> we have had eight consecutive mondays where the dow -- market has been trading lower. >> that's right. maybe we will break it this time around. >> we will see. stick around. you don't want to miss a moment of what is still ahead on today's "closing bell." coming up, european leaders taking summer holiday amid a deepening recession in the eurozone. how you should put your money to work while they are taking time off. speaking of time off -- more and more u.s. companies now offering unlimited vacation to employees. one outspoken critic said no one should get any time off while jobs are still scarce. who is right? we will debate coming up. we want to know what you think. with more companies offering unlimited vacations, is this good or bad for business?

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45 minutes to go in today's trading session. time for a quick market stat check. dow jones industrials trading in a narrow 86-point range on the heels of the best three-day winning streak of the year. right now the dow jones indus y industrial average traded down 22 points. bulls are keeping their fingers crossed the fed and european central banks will take further steps this week to stimulate the global economy. there is a tug of war battle between the telecoms and consumer staples to the upside. health care to the down side. s&p telecom index hitting the best level in more than four years. it is summertime. >> nike necklace. >> thank you very much. >> long story. it is summertime. as it is in europe, nothing is going to stop its leaders from going on holiday. not even the ongoing debt crisis. for example, german chancellor merkel has left berlin for her annual two to three-week break.

the new french president is staying in his own country but in the south of france. why wouldn't you? leaders of belgium are on vacation now. >> just like last year, investors ring fretting over the fate of europe and many of them are not taking a vacation. so is now the time for european leaders to be vacationing in hunting hard negotiations into september. steve liesman is our resident pro on all things european. >> and vacation. >> i thought you were going to say vacation. >> yes, yes. >> that was coming. nile gardner doesn't like what he is seeing. weigh in on that, will you? >> yeah, you know, do i think that european leaders take too much holiday time. basically continental europe pretty much shut down for the whole month of august. and that's not a very sensible thing to be doing. especially when europe is facing the biggest financial crisis since the authorties. i think it is a time for the

german chancellor to be heading off to the beach for lee weeks. it is a time, i think, for the german officials and officials across europe to be rolling up their sleeves and thinking of ways actually of freeing up european economies. too much big government, bad government in europe. you need to see the markets really free. we immediate economic freedom in europe. i think that's at the core of europe's economic problems at the moment. >> think about how long this crisis has been going on. haven't they had their sleeves rolled up already? don't you think they deserve a break? won't they come back refreshed? maybe they will come back with new ideas at that point. >> well, i have to say they will come back at the end of august. it is going to be -- >> we got a microphone that has taken a vacation. steve, what economic impact does it have when they are taking a vacation like that? >> let me make one point. overall europe has to increase its competitiveness. it is part of the long haul of

how europe has to reform itself to start to solve its problems. it is not just august. it is -- seems like they take two months off. august and december, sometimes well into january it feels like you try to do business with . short-term issue. one should say on the short-term part of this is that in general these leaders go away they are engaged. let's be fair about that. whether or not they actual sly the staff to effect big changes is probably the issue like you can't just stop going on vacation. he has on have his entire staff not go on vacation as well. i think he makes a good point here that this is a time to really bear down and not shove everything into september. >> at least the op-eds are not good when they do that. >> that's what i was going get to. you have protests going on in spain. have you protests going on in athens. let me go back to you niles. they can keep in communication with each other. i mean, everybody has a cell

phone and blackberry and all of those mobile devices. but the optics as bill mentioned does not look good to those people having to swallow tough posterity measures. >> yeah. exactly. the greek economy is on the verge of collapse. spain is on verge of collapse. you are dealing with a massive financial crisis across eu. this is not the time to be heading off to the beach, frankly, for the leaders. europe has to compete strongly with the economist in the far east such as china, japan. hong kong, singapore. these are places where people don't take the whole month of august off. this is a global economy. you are competing at a level. you can't be basic living on european time here. >> i would like to point out, though, sue and bill, that first of all, optics would be probably to create more levels of concern if they canceled their holidays. i'm suggesting there be a contingent of which nile is a member, if they go on holiday, being away from the policy of the government, couldn't be much

worse than having their hands on the policies of the government they had over the past several months. agree with him. there is a lot to be done. they haven't really acquitted themselves in the best possible way. >> that's my point. they have been at it this time all this tomb anyway. why not take a break and something will come to them they can figure out when they get back. >> there was -- lee, who was in the treasury during the financial crisis, pointed out they never really stopped the market from testing them from -- shorting the government effectively until they dotted every i on the bailout and stopped every, you know, really bit of water from coming through. europe is far from that right now in terms of having long-term solutions. i think the pressure will be on markets in the absence of those solution. >> think of the number of problems you have solved, steve liesman, waist-deep in a river somewhere. right? >> most of them end up being solved that way. >> there you are. my point exactly. thank you for joining us today.

steve, we will see you later. >> yeah. we will take break here and come back. the dow with about 42 minutes to go. down 18 points. whether you like it, an invest in general motors. we all are because the government is. is the marketing head the reason why the stock has been cut in half putting taxpayers deeper in the hole. >> look at the charts on this one. government may be a bad investor but is general motors cheap enough now for you to buy? that's our talking numbers segment coming up in just a moment. [ male announcer ] this is rudy. his morning starts with arthritis pain. and two pills. afternoon's overhaul starts with more pain. more pills. triple checking hydraulics. the evening brings more pain. so, back to more pills. almost done, when... hang on. stan's doctor recommended aleve. it can keep pain away all day with fewer pills than tylenol.

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. nasdaq has been underperforming the other averages all day. jackie deangelis is at the nasdaq with some of the details. >> we are looking at the nasdaq down about a half a percent right now. also looking at the stocks index right now. down about 1.2%. we have decliners out outpacing advancers 3-1 on the nasdaq 100. having some of the most negative impact i want to draw your attention to some of the tech heavy weights, microsoft, intel, oracle, google dragging the nasdaq 100 down the most. also expecting earnings after the bells. watching the stocks to see how they are faring. herballife lower. vertex and seagate trading a little higher. we are going to be watching that one very closely this afternoon. >> thank you very much. we are also watching shares of general motors trading lower toy. down by 1.5% after ousting its

controversial global marketing chief. the stock has been halved since approaching $39 earlier last year. those losses, of course, let's remember, are on the taxpayer dime because the government owe as half billion shares of general motors stock. what's next for gm shares? let's talk numbers on that. on the technical side, carter werth. on the fundamentals side, mckelly. fundamentally, what does it mean? the guy that pulled the ads from facebook. what's this do to your view of general motors stock now? >> it is a disappointing loss. we were big fans of his work with the job assurance program. every car company lost a job protection program, auto sales could be higher by 1 million units. gm story is much bigger than that. next year is a big product cycle year for gm. this is probably the right time to get management team in order.

>> you sound like you like the stock. >> we do like the stock. i think in the near term that there could be challenges. below consensus for this year earnings estimates. we are worried about what they might say thursday when the report q2 around north america profits in q3. 12-year -- 12-month outlook there is still robust. >> we mentioned the decline, stock suffered the last year and a half. what do you think? >> if there is wisdom in price, wisdom of this chart is something can't be good. i mean, talk about the strength. number one thing that matters in markets. how is an asset doing compared to asset class? underperform the stock market. stock has been strong. well-defined lows. 19, 19, 19. this is typically the setup for a bad break to the downside. another way you can draw the lines, same chart but take a look. this way. meaning the well-defined lows, actually broke this 1905 level last week. persistent downtrend. just heavy, lackluster. unable to get a bid when markets

have been quite good. >> this is not the kind of a chart that suggests to you there's value in these shares yet. >> or that -- maybe is a trap. they call them traps that -- at some point it will be cheap. not here and not now. >> this doesn't worry you like the company here. but i mean, the stock has not acted well as we are pointing out with carter. >> yeah. i think it is a lot of challenges on the macro side and europe. again in the next 12 months, history shows when gm launches full-sized pickup trucks and suvs, stock works very well. we are optimistic about the launches next year. we have done a lot of work and smoeg hiccup truck demand in the u.s. contrary to what people believe is likely to outperform the market significantly perhaps over the next 12 to 18 months. market there setting up very well for next year in north america. you are right. we need a turnaround plan in europe as well. >> good to see you. thank you. was gm's now former marketing chief made a bailout scapegoat for the stock's big decline.

that debate coming up in the next hour at 4:00 p.m. eastern time. right here on "closing bell." the dow jones industrial average down 7 points. trying its darnedest to get he the green. nasdaq, though, is still down about 12 points. up next, top economist explains how the looming fiscal cliff is hurting our economy right now because companies simply won't spend. how do unlimited vacation days sound to you? more and more companies are offering that. we will hear from one of those companies anthen someone who says employers shouldn't be offering any vacation days to their workers. after all, what are weekends for? we would love to hear from you. do you thin limited vacations are good or bad for business? tdd#: 1-800-345-2550 you should've seen me today. tdd#: 1-800-345-2550 when the spx crossed above its 50 day moving average,

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welcome back. nail biter we are watching this final hour of trade is the dow is in danger of closing lower for a ninth straight monday. we have had eight straight lower mondays here. if we go to number nine, have

you go back to 1973 to find the last time that happened. mary thompson was in kindergarten when that happened. >> that's just about right, bill. you know, we are taking a look at the housing sector index. ahead of the release of the home price index. it is under pressure today. it has been moving off the four-year high it was at earlier this month over the last couple of weeks. today no exception. the reason for the weakness today weakness in armstrong worldwide. this is the maker of floors and ceilings. lowering the outlook because of the weakness here in the u.s. as well as weakness in the eurozone. spilled over to other building materials maker. including masco. an installer of installation. back to you guys. >> all right. mary, thank you. dow turned positive while mary was talking. we may keep her on. back down three points now. we will keep an eye on that. >> they are struggling with it.

a tug of war out there today on the dow. >> unpredictable last hour of trade. once one of the biggest problems with the economy right now, listen to this, according to joe carson, it is what u.s. businesses are not doing right now. historically business investment, that is in jobs and factories, big ticket stuff, business investment in the u.s. has averaged about 110% of corporate cash flow. in the past two years numbers plummeted to a record low of 77 cents for every dollar of internal cash flow. >> so we question what's behind the dramatic shift and how does it impact the economy. joining us now is joe carson. good to see you again. i mean, we phrased the question -- why this dramatic shift by businesses? >> first, i think a lot of it has to do with the 2008 events and i think a lot of companies want morley quiddity on the balance sheets in protection against additional risk down the road. i also think the --

>> can't blame them, can you? >> not at all. i mean, given what happened in 2008 was unprecedented. and many companies thought they had a line of credit that was not there when they needed it. >> but then you are also, i think, going to make the point about this uncertainty about the fiscal cliff and what the tax implications are of making investments right now, right? >> yeah. companies base their investments on growth and end markets. they are not sure whether or not the consumers have a tax increase next year. and they also make their investments based on tax law changes. we haven't had a big tax law change on a corporate side since 1986. there is a lot of uncertainty on those two issues. >> how much does the uncertainty not just here at home but also abroad play into this? i -- take your point completably the fiscal cliff. but -- even if that was resolved in some you way, shape or form, we have the european issues, slowdown in china. there are a lot of external events impacting businesses, i would think.

>> i think that's a very good point. i think that the information we see from the second quarter, there is a different type of risk management strategy employed by companies. they are responding to the event before actually it happens. significant slowdown in order for the second quarter based on the purchasing survey. so i think the fiscal issues and if they do impact business planning, hiring and investment, those things will see over the second half of this year in early next year. >> what's the all clear going to look like? have we ever had a period of time where we are certain what tax policies are going to be? what the economic outlook is? i mean, there's always going to be some uncertainty out there, isn't there? >> that -- no question about it there. we live in an uncertain world. maybe more so today than ever before. the scale of the tax increase or scale of the fiscal cliff is you -- identified it, is record large. i mean, there's $350 billion tax

increases and another $150 billion or more of spending cuts coming. it is the scale that is scaring a lot of people. not the fact that we had tax law changes like this before. >> are you suggesting that companies will start investing again once they know what the policy is going to be by the end of the year? do we get more job creation? do we get more factory creation at that point, do you think? >> i think the elections will give us a better understanding of what will take place because of what party wins. will give us a clear understanding what they are going to try to do on the tax law and spending cuts going forward. keep in mind history does say it is the uncertainty of tax law not the tax law itself that drives forces companies to hold back. even though those rules may not be very favorable for investment, we could see a significant rebound investment next year once we get the rules passed by congress. >> we will see. joe, always good to see you. thanks for joining us today. joe carson.

25 minutes to go. dow down just four points. will we be in danger? >> you know what, we are trying very, very hard. they peek into the green every once in a while. nasdaq still down by about 12 points on the trading session. dow may be in danger of closing in the red for nine straight monday in a row. our next guest says this market is on the verge despite that if it happens at 8% to 12% rally on top of last week. very bullish call. >> also after the bell, with rumors of a positives twitter stake and mini ipad, question we ask is apple straining too far away from steve jobs' vision for the company? will that take a bite out of the stock? >> first, before we go to break, the dividend. which company stock with earnings out tomorrow has climbed the most this year? anheuser-busch? pfizer? dreamworks animation? dividend pays off after the break. questions?

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just before the break as part of the dividend we asked which company stock with earnings out tomorrow climbed the most this year. an

now the payoff. anheuser-busch shot up 30% year to date. >> today we have seen a big rally in the natural gas arena. taking prices higher by 7% on the futures. bertha coombs is at the nynex with the details on that. >> hi, sue. funds went long over the past week according to the cftc when it came to natural gas. pushed higher today after they got through technical areas. we saw that move higher in the after hours. the big issue is the hot weather that continues particularly in the midwest. also the prospect of the new storm forming out there in the atlantic. mixed picture when it came to oil and other products. we saw oil more or less flat on the day. take a look at gasoline. some refinery glitches helped push gasoline higher and more so in the august contract. that's less liquid now that it is ex- -- expire tomorrow. better to watch the september contract as a bet -- better indication. we are watching ethanol as well.

the crop report from the usda, latest weekly due at the top of the hour. ethanol moving along up with the corn. >> that's going to be very, very closely watched. thank you very much. they are making the bulls work for it today. they really are. we are down a little bit. markets are off their session lows. dow and s&p keep flirting with positive territory. right now the dow is off 16 points on the trading session. if the dow closing lower today, it would be the ninth straight down monday. it hasn't happened since 1973. >> we are toll -- we read that. >> we weren't around then. to put that in perspective past eight mondays add up to 500 points in losses for the zou. >> we should only trade tuesday through friday indeed. despite all of this, one of the next guests thinks the market will end the year at least 8% gains. joini whos that 8%? >> i'm the 8%. >> from here? >> not from here. >> we are already at 10%.

>> we may give a little back. august has been a wild month in recent years. we may get it hit the this time. august is the biggest month for babies to be delivered. investors are awaiting delivery of news from the ecb, the fed, jobs, you name it. that will contribute. >> i have never seen economic data tied to the birth rate. if anybody can do it, you can do it. >> we may give some of the gains back but later in the year. >> we exceeded your expectations for the s&p this year. you are still invest. >> sure. look at the broader market, we don't see many gains from here. we see 1350 from our target. this will be a lot of movement up and down. for us, it is about finding the right names and right themes that are going to play out when sental that banks for the next x of years. >> why not hide out in dividend paying stocks until the smoke clears out? >> three to four years. it is getting paid to wait. it is overtalked about and overdiscussed and talk bit all

the time. dividend growth stories are actually leading the market and should continue to do that. >> do you buy diaper-what are you buying? >> side step the volatility of stocks by going into municipal bonds. high quality alternative to the stock market. >> you are going have to choose carefully. have you some municipalities that have -- gone bankrupt here. >> very few thankfully but that's still -- >> certainly some sxoyts particular revenue bonds, certainly have some ri. state level general obligation is a safe bet. attractive yield. >> how about high yield corporates? >> high yield bonds look fantastic to us as well. great place also. only about a third of a half volatility of the stock market but nice returns. 7% yields. try the find that anywhere. >> you are nodding over there. >> high quality units. put that to the and crossover strategy you can hide out there.

>> what kind of yields are we talking about here? you can get into -- you know, if you go to some of the high yielding corporate rapt bonds right now, you get a good deal. taking a bug risk, though, aren't you? >> there's certainly some credit ups and downs. we are going to see. it is interesting because it is not necessarily tied to what's going on in the u.s. any time europe has a bit of a credit hiccup you see that echo and a number of markets across the u.s. as well. there will be some volunteers tilt and quite a bit less with the stock market. >> what's the yield you should above which you wouldn't want to invest in because it is just too risky at this point? >> when you start to get into the 250 over treasuries on high yields in terms of spread compression, that's when you should expect the coupon you get rather than further absolute gains in a total return situation. we are not there yet. we were not too long ago. we are back up into the 400% to 600 basis points over. the yields between 6 and 9%, that's still very good.

overall. mixed with dividend paying stocks. that's a good portfolio. >> jeff are the markets expectations this week too high? we keep hearing everybody say the fed may come in and do something to ease the situation in the united states. the ecb may do the same thing. are those expect takes misplace overall for the market? >> i think so. i think the hands are tied. i don't think the fed is going to give us much this time ruined. i think it is september, december we get qe3. risk on the jobs report. our expectations are too high or low. we have to get it in a sweet spot. jobs number comes in below 100,000 that keeps the fed on the table and limit the downside. if it is over 200,000 it may take the fed off the table and -- market may not like those number. >> what's your expectation? >> look what happened last week. greece down 6%. spain up 6%. that tells you kind of what is going to play out over the next few months. >> lot of confusion still. good to see you both. i will see you later on in the " closing countdowns. >> focusing on groupon, a big loser today.

>> shares in groupon down more than 10% today. nearing all-time low. just shy of it for groupon, latest high profile ip onto fall so much it triggers short selling restrictions. zinga and facebook hit those levels last week. reason for the groupon drop today is from a filing amazon filed with the sec after the bell on friday. noting the loss at living social was still existent and that it had yet to turn a profit. that's leading people to be extra bearish about the daily deals sector. >> like. >> deal of the day. maybe not if you are alolong th stock. 15 minutes to go to the closing bell. nasdaq last trade down 13. >> is it the drought causing food inflation now? or is it the government? what if i told you it could be both? details on that story. >> think of this.

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the nation's livestock and poultry producers are now appealing to the white house. they want the white house to suspend the mandate requiring refiners to use more than 13 billion gallons of ethanol this year as well as next year. >> pushed up the demand and prices for corn because they are worried about the massive drought around much of the country that will lead to feed shortages and keep driving those food prices even higher. this is a case of unintended consequences with the ethanol mandate push -- pushed demand up for corn so prices went with it.

now you get the drought and look at the price of corn in just the last two months. it is up 45% to record highs. you can relay to the drought. >> biggest monthly gain this year since 1988. it is an amazing story. it is not just the corn market. it is also the soybean market. you know, my question is, the drought -- no relief in sight in terms of the weather. even if they do get rain right now, it is just running off because the -- ground is so hard and -- we are starting to also see more slaughter because it is too expensive to feed those animals. it is not enough corn out there. it is really -- it has been this kind of domino effect throughout the food chain. >> the demand for ethanol has been so strong and you just wonder now what the administration's policy is going to be because president obama has been a big advocate of ethanol use as an alternative fuel to wean us off of oil. this is the unintended

consequence is the higher cost that it put on it for food stuff out there. they are still debating within the administration how to respond to the request from the livestock industry to put -- del stay mandate for one year. set it aside for one year so the demand for corn will go down and hopefully prices will come down as well. >> it is a two-edged sword because it is also an election year. he's been courting the farmers and -- court something of those very people in the livestock industry and also the farmers out there who say listen, we need a little bit of help. at the same time, you know, he's really caught very much in the middle. it will be interesting to see what they decide to do and what the lobbying groups do on both sides. >> perfect storm because this is the worst, as you know, worst drought we have seen in this country in 50 years, as you know, heading to the midwest next week on an ancestor hunt and working on -- scared to death what i will see cropwise in the heartland because the --

all reports are that the corn crop for this year, much of it is ruined. >> now they are starting to plow it under. it is better to plow interest under than it is to try to save the harvest. >> we are going to see what the bias is. up or down as we head towards the close? >> it is getting a little better. closing countdown is straight ahead. >> is general moetdors newly departed marketing boss being made a scapegoat for the stock's big decline the last year and half? taxpayers are on the hook for billions in potential bailout lows. both sides of that debate coming up here. you are watching cnbc first in business worldwide. [ male announcer ] this... is the at&t network. a living, breathing intelligence teaching data how to do more for business. [ beeping ] in here, data knows what to do.

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when you open a new account or roll over an old 401(k). so who's in control now, mayans? just inside the five-minute mark. we head towards the close with the dow down nine points. we will see if we get this ninth straight down monday which, as i said, begs the -- why don't we just not trade on mondays anymore? we will go tuesday through friday. dow last mondays lost over 500 points. i have been on the case for two weeks. i wanted to see what changed in the two-week period. we are looking at two-week charts here as we go along. i know you had a lot of volatility in the meantime. look at this. euro, net, net in the last two

weeks. down less than half a percent in that time. not much change there. you did get a good gain for the dow in this time. gain of about the 2.5%. even with all of the ups and downs and volatility there. ten-year yield about where it was when i left here at 1.5%. there it is just below that. a decline of 1% in that yield. pretty good gain important oil in that time. up 5.6%. up to $90 a barrel. also good gain for the price of gold. up 2.5% back above $1600. the ounce. vix where i left it, below 18. a decline there of less than 1%. 17.87. as for the sectors today, a slight bias to the defensive side with the consumer staples, telecom utilities all showing modest gains as we head to the close here. warren myers, this market is very much a wait and see mode here. we have a lot coming this week. >> absolutely.

lackluster day today. because of that, so much coming, we have -- comments from the fed. you know, europe, huge employment numbers at the end of the week. so much -- so many things coming out that i think everyone is going to take a wait and see and slightly defensive stance now. especially after the run-up we had at the end. >> do you take comfort in the fact we are not seeing a big pullback? >> yes and no. a good sign we did turn around and gift back. i think it is -- you know, a very tough scenario and a very much wait and see. >> jeff, do you expect the fed to announce some sort of liquidity program, new quantitative easing of program? the market would love to see that. >> it would. not this week. no. i don't think so. i think the fed will wait, see what the ecb does. >> that's not until thursday. that. >> that is convenient for the fed. i don't think we will see that. >> i don't think we will see it beforehand. there has been talk from geithner and other people we are all working together here. i think that may be enough to

get us by until the ecb speaks. >> one thing we may see is an extension of the period where they promise to keep rates low from the end of 2014 to 2015. bernanke is almost a lame duck. his term is up in january 2014. i don't think he will get another term under either president. he may be -- market may not care about what he says about extending that. >> i have been hearing a lot of speculation on that extension as well. >> what about the ecb, european central bank? do you expect them to do anything? >> i think it will be very difficult to have any formal plan as of this week. i think he put himself in a bit of a bind coming out with his comments of last week. it got the markets going no doubt about it. now the -- waiting for the details to come out. and -- longer it takes for them to come out, the more negative reaction i think you will see in the markets. >> we -- haven't even discussed earnings at this point. how they -- two-thirds of the way through the earnings reporting season here, how have we done, do you think? >> talked about the last two weeks. last two weeks of the earnings season, last nine quarters have been the best weeks of the

quarter. so we are -- now behind us. what we are likely to see now over the next few weeks is downward revisions for the third and fourth quarterings. earnings numbers high. those numbers need to come down. despite what we get in the back half of the season, numbers still likely to come down. could does appoint the markets. >> i saw you nodding your head. i guess you agree. markets continue higher even as expectations for earnings go lower here. >> that's because we have a couple of stocks under the mark wet the fed and bernanke, for what he might say. whatever could happen in europe. look what -- at the -- what we got out -- there's -- it is tough to short this market because -- at any moment when someone makes a comment like that, the markets rally. have you taken that out of the equation. i think it is very -- it is a tough market, even though you may want to. >> warren, thank you. jeff, always good to see you. thanks for joining us today at the new york stock exchange. we head towards the close here. looks like we may finish lower. it cou